For many years, Hong Kong tycoon Eric Hotung enjoyed rubbing shoulders with the power elite in Washington, D.C. His personal website has pictures of him with three presidents and U.S. political figures ranging from Zbigniew Brzezinski to Jesse Helms. His name came up in the Clinton administration Donorgate scandal, when his $100,000 contribution to the Democratic National Committee in 1995 allegedly got him a private audience with then-national security adviser Sandy Berger (Hotung was never accused of any wrongdoing). He's since donated $1 million to President Clinton's private foundation.
In 1997, he bought Edward Kennedy's house in McLean, Va., for $6 million. He also donated $5 million to alma mater Georgetown to build the state-of-the-art Eric E. Hotung International Law Center, which opened in 2004.
But now Hotung says he's done with D.C., Maryland and Virginia and will not be coming back for the foreseeable future. The 86-year-old says that's partly for health reasons but also because he has "lost all faith in the U.S. legal system."
The source of his disillusionment is a U.S. defamation lawsuit filed against him, most recently in Virginia's Fairfax County, by his illegitimate son Michael Hotung. Eric's vow not to return came in a letter he sent in March to Dennis Smith, chief judge of the Fairfax County Circuit Court. In the letter, Eric conceded personal jurisdiction based on the McLean house but urged the judge to dismiss the case on grounds of forum non conveniens.
The letter did not have its intended effect. Last Wednesday, a seven-person jury found that Eric defamed Michael in a series of 2009 interviews with Chinese-language media in Hong Kong. They ordered him to pay $1.2 million in damages.
Eric did not respond to calls for comment on the case. His lawyer, Lee Berlik of Reston, Va.'s BerlikLaw, said the verdict would be appealed but declined further comment.
Though they only occasionally spill onto U.S. shores, legal battles between members of Hong Kong's super-wealthy "tycoon" families are a staple of both the local court dockets and press coverage. At any given time, it seems some of the territory's boldface names are suing their equally boldface-name parents or brothers and sisters over a chunk of business empire.
Michael and Eric are certainly enmeshed in a web of suits back in Hong Kong. In his March letter and in a number of media interviews over the years, Eric acknowledged having an affair with Michael's mother Winnie Ho. She is also the sister of casino magnate Stanley Ho, and, according to Forbes, she sued her brother 30 times between 2001 and 2008 over the size of her stake in the gaming business. Meanwhile, Eric has previously litigated against several of his other children to try to revoke trusts held for them in which Winnie acted as trustee. He claims in his March letter that Michael's defamation suit is part of his attempt to gain control of Eric's casino investments, for which Winnie was also appointed trustee, and which he estimates to be worth around $600 million. At the same time, Michael is currently going through a messy divorce from actress Katie Chan; many of the allegedly defamatory interviews given by Eric focus on this divorce case.
"It's a bit like an Asian version of Dallas," marvels Larry Tanenbaum, a Washington partner with Akin Gump Strauss Hauer & Feld and Michael's lawyer in the Virginia case.
Tanenbaum says Michael chose to file this claim in Virginia instead of Hong Kong in part to avoid the publicity it would have attracted back home. But it was also to indicate the defamation claim was distinct from the various other Hong Kong suits. "This is about a father publicly disowning his son," says Tanenbaum. "How do you put a price on that?"